Investors in WEG S.A. (BVMF:WEGE3) had a good week, as its shares rose 5.4% to close at R$45.99 following the release of its second-quarter results. WEG reported in line with analyst predictions, delivering revenues of R$10b and statutory earnings per share of R$0.37, suggesting the business is executing well and in line with its plan. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on WEG after the latest results.
Taking into account the latest results, the most recent consensus for WEG from 15 analysts is for revenues of R$42.1b in 2026. If met, it would imply a credible 5.0% increase on its revenue over the past 12 months. Statutory earnings per share are predicted to rise 2.7% to R$1.53. Before this earnings report, the analysts had been forecasting revenues of R$41.7b and earnings per share (EPS) of R$1.53 in 2026. So it's pretty clear that, although the analysts have updated their estimates, there's been no major change in expectations for the business following the latest results.
See our latest analysis for WEG
It will come as no surprise then, to learn that the consensus price target is largely unchanged at R$53.49. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values WEG at R$70.00 per share, while the most bearish prices it at R$37.30. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.
Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. We can infer from the latest estimates that forecasts expect a continuation of WEG'shistorical trends, as the 10% annualised revenue growth to the end of 2026 is roughly in line with the 13% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 14% per year. So although WEG is expected to maintain its revenue growth rate, it's forecast to grow slower than the wider industry.
The Bottom Line
The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at R$53.49, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on WEG. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for WEG going out to 2028, and you can see them free on our platform here..
We don't want to rain on the parade too much, but we did also find 1 warning sign for WEG that you need to be mindful of.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.